For Northwest Indiana, the state budget bill that passed Tuesday is a big boost to those favoring more regional government, and an equally big slap for Porter County officials who have rejected the Northwest Indiana Regional Development Authority and the prospect of more taxes.

Language added to the states budget bill, H.B. 1001, on the final day of the special session gives Porter County municipalities more power than the county over whether to stay in the RDA.

It also potentially creates a regional transportation district to oversee the South Shore commuter service and regional bus systems, with the power to impose a new income tax of up to 0.25 percent.

Not surprisingly, the final state budget is prompting sharp reactions, with State Sen. Karen Tallian, D-Ogden Dunes, saying she’s furious about the “last-minute theatrics” and State Rep. Ed Soliday, R-Valparaiso, calling the budget bill imperfect but a “reasonable compromise.”

Among county officials, both Commissioner President Robert Harper and County Council member Laura Blaney say the RDA language amounts to taxation without representation.

The final vote on the budget was 34-16 in the State Senate and 62-37 in the House of Representatives. Several provisions added to the budget bill directly affect Northwest Indiana. One revives the earlier plan by Rep. Chet Dobis, D-Merrillville, to attempt to create a new Northern Indiana Regional Transportation District to oversee the South Shore commuter service and regional bus systems in Lake and Porter counties.

But before the new NIRTD could be established, a majority of voters in at least two of the four counties Lake, Porter, LaPorte and St. Joseph County would have to approve countywide referendums set for this Nov. 3. Each county will have to pay the costs of the special election.

Another provision appears to be in direct response to the Porter County Council’s 4-3 vote in April to pull out of its partnership with Lake County in the RDA.

The budget gives at least two municipalities in Porter County the authority to join the RDA. Not only would these municipalities get to jointly appoint their member to the RDA, replacing the county’s appointee, but they would also have their RDA dues paid for by the county income tax enacted in 1995 when the county council first voted to join the RDA.

Other Northwest Indiana provisions in the budget bill include funding for the Little Calumet River Basin Commission and an initial $3 million in planning for a new teaching hospital in Gary, a far cry from the $300 million that State Rep. Charlie Brown, D-Gary, originally sought. Left intact was $14 million for adult education statewide, short of the $3 million increase that Tallian sought.

Earlier this session, State Rep. Ed Soliday, R-Valparaiso, proposed legislation that sought to allow Porter County municipalities to stay in the RDA despite the county’s withdrawal, with a possible new income tax funding their dues.

A version of that proposal made it into the final bill, but one that would use the existing countywide income tax for the cities or towns that wish to stay in the RDA.

“Even if you’re in favor of the RDA, this is un-American,” Blaney said in response. Blaney was one of four council members who opted to withdraw the county from the RDA.

Noting that the population of unincorporated Porter County is greater than any individual city or town, Blaney said large segments of Porter County’s population would be taxed, but not represented, if at least two municipalities opt to join. “How can you tax people without representation?” she said.

Harper, too, said he finds the legislation defective because it singles out Porter County and “creates taxation without representation.” He questioned why Porter County should be essentially forced to pay towards the RDA, when the city of Gary is still behind in its RDA dues and speculation is that East Chicago is considering a pull-out as well.

Tallian released a statement highly critical of the last-minute wrangling over the budget bill, including the RDA language.

She said she did not agree with the councils decision to withdraw from the RDA, but called the provision giving at least two towns the ability to stay in the agency an “unworkable arrangement.”

On Nov. 3, voters in Lake, Porter, LaPorte and St. Joseph counties will be asked to vote in a referendum with the following question:

“Shall there be created the northern Indiana regional transportation district under IC 8-24 to provide a regional rail system serving Lake, Porter, LaPorte, and St. Joseph counties and regional bus public transportation system serving Lake and Porter counties with (name of county) becoming a member of the district?”

The budget bill states that if the majority of voters in at least two of the counties vote in favor, the NIRTD is established. However, the bill also indicates that if a referendum fails in one of the counties even if it passes in two that county would not be a member.

The NIRTD board would then have the ability to impose a new income tax of up to 0.25 percent in each of the member counties.

The NIRTD would be structured with a main NIRTD board, a commuter rail service board, a commuter rail service advisory board, a bus service board, and a bus service advisory board.

The NIRTD Board would consist of seven members, four from the members of the separate rail board and three from the separate bus service board, plus three non-voting members representing the president of the Gary Airport Authority Board, the president of the South Bend airport board and a governor appointee.

The current members of the Northern Indiana Commuter Transportation District would make up the rail service board. The new bus service board would be made up of a representative from the Lake County Council, the Porter County Council, and the mayor of each city with at least 25,000 people from Lake and Porter counties, assuming both counties opt to join the NIRTD.

Harper predicted a “huge battle” over the referendum in Porter County. He also said he wished the referendum could have been held in next year’s elections, instead of forcing the counties to pay for a special election this year.

Harper maintained that the numbers don’t support the South Shore extension coming to Valparaiso and that the new tax in Porter County would be used to shore up Valparaiso’s city bus service. He also said that the bus systems in north Lake County are said to be out of money. But he also pointed to the hefty casino revenues these cities get; East Chicago, for example, received $13.5 million in casino distributions in fiscal year 2008. At the same time, he said East Chicago employs more people just in its park department than the entire city government of Portage.

Tallian, too ripped the proposal, calling the referendum language a “mess.”

“Not only are the counties going to have to hold costly special elections, but the process is not verywell thought out. Because of its hasty last-minute drafting, the section fails to address what might happen if two counties join, but the other two do not. We are going to spend a lot of money holding an electionthat could very well just leave us with more unanswered questions.”

Tallian further blasted the last-minute deal making over the budget bill that she wasnt privy to, despite serving on the state budget committee, the Senate Appropriations Committee, and as one of the advisors on the budget committee.For his part, Soliday released a statement that addressed the statewide funding issues in the budget bill.

“While certainly no budget is prefect, the one the House passed today meets many of the requirements we had,” he said. “Education is reasonably funded for these tough economic times with adequate reserves for unexpected expenses and downturns. Most important, Hoosiers should not expect to see any tax increases. Additionally, the funding for the Little Calumet River Basin will reduce our risk of flooding many homes. Overall, I believe the legislature reached a reasonable compromise and one that will protect our taxpayers.”

Posted 7/1/2009